• Cook: Over 300 million addressable customers in this next LTE rollout phase
• Cook: Currently we have 24 LTE carriers around the world; next week we’re adding 36 more LTE carriers to support iPhone 5

• Cook: I see cannibalization as a huge opportunity
• Cook: We somebody buys their first Apple product, a significant number of people (halo effect) buy other Apple products
• Cook: Tablet market will be larger than PC market – said it for three years now and still believe that
• Cook: We never fear cannibalization. It is an opportunity. iPad will cannibalize some Mac. iPhone has cannibalized iPod. This does not bother us.
• Cook: iPad mini, iMac, iPhone 5, iPhone 4/4S were all constrained last quarter; iMac may remain constrained in this quarter due to strong demand

• Cook: Last quarter, we had strong sales for iPad and iPad mini
• Oppy: We would expect a large YOY increase in iPad sales, but a typical, post-holiday sequential decline
• Cook: We believe that we can achieve supply/demand balance on iPad mini this quarter
• Cook: iPhone 5, with thenumbers we’re selling, is selling to a lot of new customers.

• Cook on Apple TV (as prompted by, of course, Gene Munster): We sold over 2 million Apple TV units in the quarter, up almost 60% YOY (13 weeks vs. 14 weeks). This is an area of intense interest for Apple. Cook declines to say any more about television.

• Cook: I am very happy with how things are going in China; China is already the 2nd largest region for Apple and it’s clear there is a lot of potential
• Cook: 6 stores have grown to 11 stores in China and we have much work to do
• Cook: iPad shipped to China very late in the quarter and despite that saw very nice growth
• Cook: Total greater China, including retail stores, revenue was $7.3 billion, up over 60% YOY and this is 13-weeks vs. 14-weeks
• Cook: The number of new product ramps last quarter was unprecedented for Apple. We feel great to have delivered so many new products for the holiday season

• Oppy on CapEx: We expect to spend about $10 billion this fiscal year, $1 billion on retail stores; $9 billion on equipment for partner facilities and adding to data center capabilities and for infrastructure

• ASP for iPhone essentially the same YOY

• AAPL @ 5:40PM EST: down $50.52 (9.83%) to $463.49
• Oppy: iPad mini – we could not make enough, we were constrained every week; we ended the quarter with a significant backlog

• Over 40 billion App Store downloads
• Over 450 billion iMessages sent
• We’ve now sent over 4 trillion iOS Notifications
• Cook: Apple Maps is already much improved and we will continue to work on it until it meets our incredibly high standards
• Cook: We are working on some incredible stuff, the pipeline is chock full, we feel great about the pipeline

• Cook: Our portable Macs alone were in line with IDC’s forecasts
• Cook: To a lesser extent, the market for PCs is weak. Apple sold 23 million iPads and could have sold more, but could not build enough iPad minis to satisfy demand.

• Cook: If you look at Q112, Mac sales were 5.2 million vs. 4.1 million this quarter. iMac down by 700,000 units YOY. This is due to supply constraints of new iMacs. We left the quarter with significant constraints on the new iMacs. We tried to tell people this on the conference call in October. if you look at last year, it was 14 weeks vs. 13 weeks this quarter. Our channel inventory down by over 100,000 units; we didn’t have the iMac in channel inventory.

• Cook on smartphone market share: The most important thing to Apple is to make the best products in the world that enrich customers’ lives. We are not interested in revenue to revenue’s sake. We want to make only the best products. iPod is at different price points and gotten reasonable share.

• Oppy: Guidance in the past we gave you a single point estimate; it was conservative that we had reasonable confidence of achieving; going forward we are now providing a range of guidance that believe that we will report within

• Cook: “I know there has been lots of rumors about order cuts and so forth and so let me just take a moment to make a comment on these. I don’t want to comment on any particular rumor because I would spend my life doing that but I would suggest it’s good to question the accuracy of any kind of rumor about build plans and also stress that even if a particular data point were factual it would be impossible to accurately interpret the data point as to what it meant for our overall business because the supply chain is very complex and we obviously have multiple sources for things, yields might vary, supply performance can vary. The beginning inventory positions can vary, I mean there is just an inordinate long list of things that would make any single data point not a great proxy for what’s going on.”

• Cook on rumors of iPhone component cuts: It’s good to question the accuracy of any rumors about build plans. Even if numbers were accurate, it’s difficult for those outside of Apple to properly interpret the reason(s).
• Cook: iPhone sales very constrained for much of the quarter; iPhone 4/4S constrained for the entire quarter

• Cook on iPhone screen sizes: iPhone 5’s 4-inch Retina display is the most advanced display available int he industry today; we put a lot of thinking into screen size and believe we’ve picked the right one

• Oppy: We continuously assess stock buybacks and dividends; we do consider increasing these programs and we will do what’s in the best interest of our shreholders
• Cook: We increased 70% in iPhone sales; triple digit growth in China; both of which are higher than the overall market

What can we do? “We” can’t do anything but you can do what you want. Personally, I’m a long on AAPL so I just smile and laugh but it is hard to watch illogical reaction to nonsense when you have a company that is making SO much money and has no debt and has said it will continue to make more. I’m sure you’ve read all the article of late that said AAPL is undervalued. It is and that’s pretty much all you need to know if you are long on AAPL.
I don’t know what “we” or you are going to do but for me…..I have $50k burning a hole in my pocket. Just waiting for the bell curve to form. Good luck!

After hours trading is usually not available to most investors. If you think the stock is worth $700 then $460 is a bargain. If you are like most people, you will wait to buy as the stock continues to fall because you don’t really believe in AAPL. I wish you luck in trying to pick the bottom and meanwhile, the stock will continue to fall while you and many others don’t buy.

In the end, the institutions will start buying and you will be waiting for it to drop to the ‘low you could have had’ and miss the ride up.

Anyone surprised by this ought to get over themselves and their irrational belief in this company. Today you can order every Mac from every vendor except Apple Inc. at the deepest discount in the company’s history. Samsung is taking over the mobile device market.

Demand the departure of Tim Cook and hope there is someone out there who can remake this company and turn things around or send back shareholders’ money and take the thing private.

I’d like to hear from Tim Cook what his views are as to why the number of Macs shipped dropped so drastically. I’m aware of the likely reasons, shorter reporting period, constrained iMac supply, but I’d still like to hear his views as to whether this indicates a shift towards a post-PC world.

Funny you should say that. Earlier today, before the quarterly report, I was thinking that the market doesn’t deserve Apple. Altho it is essentially impossible to take Apple private because of its total valuation, it really should be a private company. The market will never understand Apple and its approach.

Question – is the earning per share including the $2.65 for dividend? With a billion shares the dividend will cost $2.65B. Last year they did not pay a dividend so I don’t know how they account for the difference.

For the record, the market actually should be freaking out at AAPL’s earnings. Even adjusting for the 14 week quarter, EPS growth is coming in at under 10% for the quarter – which is especially disconcerting considering that 1Q is usually AAPL’s blowout quarter. The only way you get to be worth $500B is projections of growth on Apple’s annual free cash flow (about $40B annually). If Apple is no longer growing at double-digits per year, that $500B market cap is really hard to justify. Especially in the businesses Apple is in, it’s not impossible to see EPS drop or stabilize, and if you apply a discount rate of 15% to Apple (high, but not nuts), your valuation gets you to $400 per share pretty easily. I think it’s worth more than that – but the slowdown in growth is not good at all.